Washington’s decision to lift most of its sanctions against Sudan along with the EU’s easing of certain measures targeting Zimbabwe are two of the key developments highlighted in the latest edition of Alaco’s Guide to Sanctions, which helps businesses navigate the rising number of trade and investment restrictions affecting jurisdictions around the world.

Updated quarterly, the guide provides an overview of all the sanctions programmes operated by the EU, the US, the UN and Switzerland, including detail on restrictions in place, implementation timelines and links to the underlying official documentation.

The guide distils the raft of often dense sanctions-related trade regulations and legal documents into concise notes that enable readers quickly to assess the risks of doing business in developing world markets.

The latest edition of the guide shows that over the past three months 12 sanctions programmes have been extended, notably Russia/Ukraine (EU), Yemen (UN) and Sudan (EU), with the EU’s human rights-related sanctions programme on Iran to be reviewed imminently.

Most significantly, many US measures against Sudan have been removed in recognition of Khartoum’s role in combating Islamic State and other terrorist groups. The sanctions relief, which came in the form of an executive order by Barack Obama on January 13 in the last days of his presidency, includes the lifting of a trade embargo and financial restrictions on the Sudanese Government as well the unfreezing of its assets. However, US sanctions against those individuals and entities deemed to be responsible for the Darfur conflict will remain in place.

Implementation of the executive order is to be delayed until 12 July in an apparent bid to encourage Khartoum further to improve its human rights record and resolve internal conflicts. But an exemption to the order – a general licence issued by Obama on 17 January – permits US companies to trade with the country during the intervening period, effectively a 180-day-long trial. President Trump will ultimately decide whether to proceed with the sanctions relief once the review period is over.

In another important sanctions development, the EU extended its restrictions on Zimbabwe’s President Robert Mugabe and his wife, Grace, on February 20 but partially lifted an arms embargo to allow for imports of explosives on condition they are only used in civilian mining and infrastructure projects.

EU sanctions were introduced in 2002 over allegations of election fraud and rights abuses. They have been eased in recent years to encourage political reform, but a travel ban and asset freeze targeting Mugabe – who will contest next year’s presidential elections at the age of 94 – and his wife, along with the arms export ban, have remained in place.

The partial lifting of the weapons embargo reflects the EU’s carrot-and-stick approach to promoting positive change. The country, which shows no sign of emerging from its long-standing economic stasis, is currently suffering a crippling cash shortage.

The loosening of the sanctions programmes targeting Sudan and Zimbabwe represents one of the final steps in the normalisation of their relationships with the international community. In Zimbabwe, this process will likely conclude with the eventual death of the ageing Robert Mugabe, now the world’s oldest living head of government. Sudan’s progress is likely to be more difficult, as the government is subject to ongoing complaints regarding serious human rights abuses.

In any case, neither country, despite their mineral wealth and strong agricultural sectors, is likely to see a major uptick in inward investment from the West in the immediate future. Both have seen their economies devastated by decades of embargoes and trade restrictions, and Sudan has lost large swathes of land, including the majority of its oil reserves.

In other new developments covered in the Alaco guide, on December 20 the US sought to close an apparent loophole in its sanctions against North Korea. Officials in Washington have suspected for some time that Pyongyang takes advantage of its UN diplomats’ bank accounts to transfer money back home.

To clamp down on this practice, the US removed a sanctions exemption which has allowed US banks to service North Korean diplomats without getting prior approval from Treasury officials. Banks will now require such authorisation for opening new accounts, processing transactions or extending credit to diplomats and members of their families.

In another limited sanctions revision on February 2, the Treasury amended Obama’s executive order prohibiting US citizens or companies from engaging in business activities with the FSB after Russia’s security services were implicated in an alleged plot to interfere in the 2016 presidential election.

A seemingly unintended consequence of the order was that US businesses were unable to export consumer technology goods to Russia, since the FSB issues licences for such shipments. The Treasury amendment allows American companies to pay the FSB up to $5,000 a year for approvals on condition the transactions do not violate other aspects of the US sanctions regime.

If you would like more information about the Alaco Guide to Sanctions or are interested in subscribing, please contact James Birkett: jbirkett@alaco.com